Our First Payroll Lecture is Here

I am offering my first payroll lecture of the year next week on June 18th.  The subject will be travel pay. The lecture is two hours from 10:00 am to Noon Pacific time.  It is approved by the APA for 2 RCHs.  The nominal charge for the webinar is $99.  You can register under our Shop on our website. 

Learning Objectives:

  • Understand the FLSA requirements for paying an employee who travels
  • Comprehend the best practices for tracking and paying for travel pay
  • Understand the IRS requirements for taxing travel pay reimbursements including per diems and accountable plans.

EFT, ACH and EDI are Different and It Matters

In payroll we tend to use the terms EFT, ACH and EDI interchangeably.  But in actual practice they are quite different.  To help explain these important differences the National Automated Clearing House Association or NACHA has provided some guidance on their April 29, 2019 blog, written by Rober Unger.   It is helpful to payroll professionals to understand these terms and use them correctly.  I found this blog extremely helpful and I hope you do to.

The Social Security Wage Base Projections Are Here!

Every year we, in payroll, wait in anticipation for the social security (OASDI) wage base to be announced. This basically heralds in the year end/year beginning processing time.  But for some, maybe those responsible for employment tax budgets or financial reports, the wage bases for future years is a handy thing to have all at once and not just wait for it at the end of the year. For this reason, the Social Security Administration (SSA) publishes their estimates for the social security wage base each year.  The years 2020-2028 are included in this year’s 2019 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Disability Insurance Trust Funds.   The SSA provides three estimates, high, intermediate and low. For example, for 2019, the actual wage base is $132,900. However, the 2018 report projected $132,300 to $136,800.  The following chart lists the projections estimated by SSA (on page 115 of the report) for calendar years 2020 through 2028:

We still have to wait until October or so for the actual 2020 wage base, but the estimates can be useful in predicting future labor costs.

 

Reminder: Keep up with the payroll news by subscribing to Vicki’s e-news alerts, Payroll 24/7.  The latest payroll news when you need it, right to your inbox.

A Fresh Approach to Payroll Training is Coming Your Way!

I am proud to announce that I am once again offering training webinars but this time with a fresh approach.  We are an approved provider by the American Payroll Association (APA).  This means that my training can earn you RCHs as well as enhance your education.  But my training will be different than the usual fare that you get for webinars, even the ones I conduct for other vendors.  Instead of just listening, my webinars or “lectures” as I call them, will be interactive. Let me explain how this works.  I am an adjunct faculty member at Brandman University and am responsible for their Practical Payroll Online program. I do all of the materials for the program as well as teach the courses.  Each year I record various topical lectures for my students to use in each of the five courses.  These “lectures” are provided live to the students at a certain date and time and are recorded using the Zoom software Brandman provides. Students may attend the live event or may choose to view the recorded version, it is up to them. Because these are related to the course work, they include more interaction than standard or traditional webinars. For example, you can ask questions at any time during the lecture just as you would in a live classroom setting. You may have forms to complete (such as the lecture on the Form 941 or Form W-2) or you may have calculations to perform for the child support lecture. Each lecture is a full two hours, so more time to devote to the information and to related questions.

Students enrolled in the Brandman program are permitted to attend the lectures for free and do not receive RCHs.  However, I have had numerous requests to provide payroll training that gives RCHs so this is how I have decided to offer that training to my non-students.  I will post the latest lecture on my website.  All lectures are during normal business hours and usually held on Tuesday, Wednesday or Thursday.  I cannot offer these lectures for free.  There is a fee for APA certification, but I want to keep the costs within everyone’s budgets.  The introductory cost will be $99 per lecture per attendee.  That is two RCHs for less than $100 and no sales pitches or follow-ups about buying anything.  You may sign up with a personal email or with your business email, whichever you prefer.  And you don’t need to worry about getting your questions answered.  Since this is still a “class-room” style setting I am limited to only 20 additional attendees per lecture. So you won’t be lost in the multitude of other attendees vying for attention.

I will be offering our first lectures in May on Travel Pay, Child Support, Multistate Taxation, and Wage and Hour Law.  June’s lectures will include California Wage and Hour Law, Tax Levies and Creditor Garnishments, Payroll Procedures, and Abandoned Wages.  As each lecture is approved by the APA it will be posted to our website and open for registration. You simply pay online for the lecture and you will receive all the info for how to log into the classroom on the day of the lecture within two business days of registering.  After the lecture, your Certificate of Attendance will be issued once we verify you have completed all the required time in the classroom, the required APA polls, and the survey,  usually within 2 weeks after the lecture.

Unfortunately, although the lectures are recorded for use on the Brandman website, I cannot offer the lecture as an on-demand product or after the fact electronic version.  Only live attendees will be accepted. But you always have the option of signing up for the Brandman course which features the lecture and if you complete the tests and quizzes can receive up to 8 RCHs for $200 per course for APA members. One more way to earn RCHs at a low price.

We are very excited to be offering this learning opportunity to our social media network.  We hope you find our lectures informative and useful. Further announcements for exact dates and topics will be coming.

New DOL Wage and Hour Opinion Letters Have Been Delivered. Let’s Look Inside…

The U.S. Department of Labor (DOL) announced on March 14th, that they had released new opinion letters on their website.  These letters address the compliance issues related to the Family and Medical Leave Act (FMLA) and the Fair Labor Standards Act (FLSA).  Before we review the new opinion letters for the FLSA, let’s do a quick review of what exactly is an opinion letter.

The Wage and Hour Division issues guidance primarily through Opinion Letters, Ruling Letters, Administrator Interpretations, and Field Assistance Bulletins. They are provided on the DOL website.

An interpretation or ruling issued by the Administrator interpreting the Fair Labor Standards Act (FLSA), the Davis-Bacon Act (DBA), or the Walsh-Healey Public Contracts Act (PCA) is an official ruling or interpretation of the Wage and Hour Division for purposes of the Portal-to-Portal Act. 29 U.S.C. § 259. Such rulings provide a potential good faith reliance defense for actions that may otherwise constitute violations of the FLSA, DBA, or PCA. Prior rulings and interpretations are affected by changes to the applicable statute or regulation so an employer should always periodically review any relevant opinion letters that it uses as a basis for a policy to ensure that changes have not occurred. From time to time the DOL updates its interpretations in response to new information, such as court decisions, and may withdraw a ruling or interpretation in whole or in part.

Now on to the new letters just recently issued.

FLSA2019-1:  This opinion letter clarifies the FLSA wage and recordkeeping requirements for residential janitors and the “good faith” defense. Discusses what to do if the FLSA and state requirements do not match. In this case the state of New York did not consider the employee subject to minimum wage and overtime but the FLSA does.

FLSA2019-2: Addresses the FLSA compliance related to the compensability of time spent participating in an employer-sponsored community service program.

I always encourage employers to use the opinion letters when formulating policy.  If you don’t see an opinion letter that addresses your issue, you may ask for one to be issued on that policy or question by submitting the request online.  Of course, not all requests submitted result in an opinion letter being issued. Or it may be issued but as a non-administrative letter which holds less weight. But it doesn’t hurt to ask!

Reminder: Keep up with the payroll news by subscribing to Vicki’s e-news alerts, Payroll 24/7.  The latest payroll news when you need it, right to your inbox.

Taxpayer Advocate Annual Report: Payroll is Upfront and Center in this Year’s Recommendations

The Taxpayer Advocate Service is an independent organization within the IRS.  Its purpose is to ensure that every taxpayer is treated fairly and to help taxpayers know and understand their rights.  The current Taxpayer Advocate is Nina Olson.  Each year the National Taxpayer Advocate (NTA) releases their Annual Report to Congress.  This report describes the challenges the IRS is facing. Federal law requires that the NTA’s annual report identify at least 20 of the most serious problems encountered by taxpayers and to make administrative and legislative recommendations to mitigate those problems. The following are the highlights of this year’s recommendations that affect payroll:

  1. Alternative to Form W-4: The report recommends scraping the Form W-4 altogether and analyzing the feasibility of adopting an IRS-determined withholding code. This approach is currently being utilized in the U.S. tax administration.  It also recommends that withholding be expanded at the source to encompass not only wages, but taxable interest, pensions, dividends, capital gains, IRS income, unemployment and even, potentially, certain earnings as an independent contractor.
  2. Furnishing Information Returns Electronically: Information return data to taxpayers should be furnished electronically for direct importation into tax return preparation software or to authorized tax return preparers.
  3. Lower Electronic Filing Thresholds: The report recommends requiring employers with more than five employees to file Forms W-2 electronically.
  4. Form 941 Filing: Recommends requiring Form 941 contain information about each employee’s name, address and social security number. To promote electronic filing, direct the IRS to use the fillable form currently on the IRS website and reformat so the form can be electronically filed, at no cost, directly from the website.
  5. Effects of the new tax law and the shutdown on overall IRS workloads: With all of the new tax forms needed to incorporate the changes to the tax code the IRS was overwhelmed. Add to this the shutdown and the antiquated systems (IRS has two of the oldest IT systems in the federal government) and you have a recipe for potential disaster. Because of these issues the IRS is now having to process more than five million pieces of mail and over 87,000 amended returns. All manually. IT modernization was the number one recommendation in this report.

Whether or not the recommendations are implemented is anybody’s guess.  But as the situation is becoming more intense at the IRS for meeting deadlines and handling the workload with antiquated systems it will be well remembered to monitor this report for any upcoming legislative changes.  Especially in the area of electronic filing, lowering thresholds and replacing the Form W-4.

Reminder: Keep up with the payroll news by subscribing to Vicki’s e-news alerts, Payroll 24/7.  The latest payroll news when you need it, right to your inbox.

Election Day a National Holiday?

Well it’s almost over, the 2018 election. Still having a few counts here and there with a runoff election still to come. But all in all, the 2018 election has come and gone. The only thing that remains, as it does after every election cycle here in the United States, is the discussion of making election day a national holiday. But what exactly does a “national holiday” mean here in the United States?

It appears to me that most people who discuss having election day designated as a national holiday don’t understand how holidays work here in this country. The United States does not have national holidays. It’s that simple. Yes, we have days that are designated as a holiday on the federal level. But these days are not official holidays for all employees in the country. They are, rather, the days that federal employees are given off with pay. I have stated this before, in other blogs, but will state once again. The United States is the only country that does not mandate that employees receive days off with pay in honor of national holidays. When I say other countries, I am speaking of course of industrialized countries. But this list of industrialized countries includes Chad, Peru, Slovenia and Sudan. So, we are not only talking about major European countries such as Germany or France. But if we were just looking at European countries let’s take Germany as an example. Germany has one national public holiday which is their German Unity Day, with the remaining 9 to 13 holidays being regulated by what they call their states even though some of them are held nationwide. Now this is in addition to 20 days of vacation as well as additional dates that the employer may give as a public holiday. Yet despite this they have a very strong economy. Yet here in the United States is not mandated for all employees to have the nation’s birthday, July 4th, off with pay.

Therefore, when local, regional, statewide, and national elected officials talk of having our election day as a national holiday it means nothing to the average worker if it were simply to be added to the holidays we already have. Yes, many employees may get Christmas off with pay, or Fourth of July off with pay, but not all employees are required to be given the day off with pay. It all depends on the company’s or employer’s policy. According to the Bureau of Labor Statistics workers in private industry in the United States receive an average of eight paid holidays per year based on the latest statistics in 2017. Workers in the manufacturing and information industries are more likely to receive paid holidays (97%). But workers in the leisure or hospitality industry only receive paid holidays 37% of the time. Not all workers receive the same holidays or the same number of holidays. For example, again the Bureau of Labor Statistics states that workers in manufacturing and financial activities receive an average of nine paid holidays per year while workers in leisure and hospitality receive an average of six paid holidays per year. For clarification, there are 10 annual federal holidays with Inauguration Day occurring only once every four years for a total of 11 days.

Before you start the discussion of employees who would not be able to have a day off due to their type of work such as first responders, hospitals and even restaurants, other countries have already addressed this issue quite easily.  It is usual for the employee who must work on a “mandated holiday” to have another day off with pay. So, if on a Monday holiday, I would have to work as a police officer, I might get Tuesday or Wednesday off with pay in addition to my normal days off.

My question to all the elected officials and others who advocate a national day off to vote is this:  Where would this national election day fall? Would it establish our first and only mandated national holiday? Or would it just simply be added to the calendar as another day to shop, BBQ or sleep in, if and only if, my employer decided to give me the day off with pay?

Keeping Remote Freelance Workers Accountable

We have another guest blogger with some great info for you.  Hope you enjoy it.

As attested by Pew Research self-named Generation Y (those born during the 1980s and early 90s) have eclipsed previous generations in regards to workforce involvement. In fact, according to a recent survey  a vast majority of millennials feel that “flexibility and ambition” are closely associated. With 78% of this group more likely to have a full-time spouse/partner working, there’s little surprise that workplace formulation has made a tremendous shift. The upshot is telecommuting. Actually, businesses today are no longer put-off by home based work requests and frequently include work-at-home proposals in HR recruitment plans.

The increase in millennial contemporaries has introduced massive modifications in the way companies manage their staff due to remote employment. The millennial workforce is expanding, proficient, and au fait with the demands of today’s global economies.

The concept of remote workers continues to be an anomaly of sorts, as more convenient options of generating income has yet to sink into the psyche of the masses. To many individuals, the traditional way of working is the only viable means of employment. Questions like, how people get paid, how companies account for workers, and is it serious work are common. Unfortunately, short-sighted suppositions prevent many who could benefit from remote work the opportunity to take advantage of it.

Organization Advantages and Accountability

Consequently, a long-term sophisticated system must be established to consolidate the undertaking and oddities of the digital workforce, as telecommuting is now accepted as the adopted workforce for both large and small companies. As a result, many corporations have devised means of cutting costs in the current world of financial dubiety with access to a worldwide top-notch labor force.

Outsourcing is mutually beneficial for both companies and their remote staff. For example, individuals with physical limitations are able to find work while companies increase production, downsize office space and save on office equipment.

Nevertheless, making remote workers accountable is a sticking point for many corporations. What strategies and blueprints are foolproof enough to ensure that telecommuters are actually on-the-job and not sipping tea while watching the latest reality show?

Keeping Remote Workers Accountable

HR managers, CEOs, and IT folk at both large and small businesses, are hard-pressed to discover a way of guaranteeing that their employed remote workers are actually working. It’s much like maintaining a long distance relationship without the romanticism. What it comes down to is implementing a superb software program. Here are three suggestions on how to keep remote workers accountable.

  1. Consolidate Correspondence

Dissimilar to staff working in an office, remote staff may experience delays in correspondence due to a lack of face-to-face interaction. To clarify the situation, companies should consider arranging several specific communication techniques that coordinate with a virtual program for work at home employees. For instance, some businesses use social computer networks or employee apps like Blink or VeryConnect. These types of networks allow virtual staff to stay connected to other telecommuters who may offer assistance and management throughout the working day.

Another solution for communication issues include using Skype or Google Hangout in case of inaccuracies via chat or email. Of course, the good ole’ 19th century invention called the telephone is still viable in its 21st century incarnation known as a smartphone.

  1. Highlight Clarity

Remote teams require a sophisticated level of management and transparency across every  line of work. In light of this, it is crucial to employ a system that allows access to a telecommuter’s tasks, work hours, pay arrangement (for instance by the hour or by each task), etc. Software systems like Time Doctor offers everything from time tracking and screen shots to web usage, payroll, reporting and more. This type of software tracking system helps employers keep remote workers viable and accountable.

Businesses must keep track of telecommuters working hours and additional vital information to make sure all is aboveboard; therefore, the correct software set-up is vital for companies and their teleworking staff. In addition, companies must make modifications and incorporate accountability into the workflow. Well-organized coordination between employers and remote workers substantially increases productivity according to Remote.Co.

  1. Planning Ahead

Working virtually is not exempt from stumbling blocks. In spite of that, there are a number of reliable methods to contend with the most frequent problems. For example, what if an employee has unreliable Internet? The best solution is to make certain that a potential team member has a stable connection before hiring them. In fact, a secure Internet connection should be a priority for remote workers. In case something does happen, a telecommuter should have access to a Wi-Fi hot-spot nearby. If not, stopping by the office is another option if it’s close by. Doing something is better than doing nothing and letting technical problems get in the way of a day’s work.

In essence, it’s about using common sense ways and means to anticipate difficulties that might arise from using remote workers and making provisions for them.

 Vaishali Badgujar is a digital marketer at Time Doctor, a SaaS time tracking & productivity tool for companies & freelancers. She is an inbound marketing expert & specializes in link building. 

4 Ways Payroll Can Boost Employee Satisfaction

During the summer months I take a break from blogging but love it when I have guest bloggers who can provide my followers with interesting information. Today’s guest blogger has some great insight as to how payroll can help employee satisfaction.  Take a read from Sam at Https://indextimeclock.com

How many smiles greet you each morning when you enter the office? Can you honestly say your employees are satisfied and happy to come to work?

Of course everyone would rather be at home relaxing but good management can lead to a high level of employee satisfaction which makes for a smiling team that’s also highly productive. That’s a win for everyone.

But how do you get there?

What Determines Employee Satisfaction?

Will you be surprised to know in many studies compensation rates as the number factor in workers’ satisfaction with their jobs? So you can already see that your payroll department plays a vital role in getting this right. If no salaries are paid you definitely won’t see any smiles around you.

Of course this is a complex situation so there are many factors at play which you have to manage:

  • Being appreciated for work delivered
  • Relationships at the office
  • How the company fares financially (everyone wants to be proud of where they work)
  • Personal development
  • How interesting the work is
  • Feeling safe at work
  • Company values workers can be proud of

But why should you concern yourself with this? Because you don’t want to take the risk of having a high employee turn over rate. When you lose employees to other companies where they do find what they’re looking for you’re risking:

  • High costs to train new employees
  • Struggling to get the quality workers you need to grow your business
  • Gaining a reputation as a company no one wants to work for

But perhaps you’ve tried working on these aspects in your office but they don’t seem to stick. Are you sure you’re working with the root of the problem? Few businesses realize how much the payroll department in your business can affect your employees’ overall experience of their work days.

So let’s help you gauge whether payroll is helping or hindering your business. We’ll also tell you how to get it right from now on.

How Can Payroll Help?

Does Your System Put Them First?

What do you do when you respect someone? Usually it motivates you to put their wishes before your own. At the very least you’ll consider how your actions affect them. How often do you do this with your employees?

A late or wrong salary payment may seem trivial to you but for someone with bills to pay it can turn an ordinary day into a disaster. When you use state of the art payroll systems that rely more on AI and automated features than manual work you’ll see fewer salary glitches.

While you’re showing respect you also prevent a problem. When there are fewer disputes in the office you’ll see relationships will be healthier which will automatically make your group more excited to get to work each day.

Of course new technology requires a monetary investment from your side but this one decision will signal to employees that you have their best interests at heart. That will create loyalty from their side so this benefits you in the long run too.

Do They Feel Appreciated?

This one rates high on the list of factors you need to manage. And saying thank you at the end of each day won’t suffice.

Have you considered some of these tactics?

  • Personal discussions with employees regarding their work, performance reports and development in the company. This signals that you take notice of each individual.
  • Identifying how well someone settles in during an onboarding process. Talking about the challenges someone experiences and mentioning the value he or she already added will keep someone motivated.
  • Suggest personal development options such as training or skills courses. This could be an incentive or a reward for someone who delivers exceptional work.
  • Bonuses paid to individuals who reached certain sales goals.
  • When someone goes through a troubling time you can show compassion and provide some time off. This isn’t something people should take advantage of and your decision should be based on the value the individual provided before the problem came about.

Can you see how many of these processes involve your HR and payroll department? But the only way to keep track of all this information is with state of the art HR management and payroll programs. Digitizing employee files and creating reminders for setting up performance appraisals will ensure you don’t forget a step in the process of looking after employees..

Can You Pay Them More?

Of course all employees want to be paid more. You can’t always give them the salaries they dream of but while everyone gets busy with other tasks it’s the payroll office’s responsibility to ensure salary increases and bonus payments happen according to company policy & promises.

Don’t let this one slip. It sends a message of not caring for your employees which you should prevent at all costs.

Can you help them get it Right?

Many employees are used to being reprimanded for wrong doing. Something that’s not as common is getting help or resources to prevent the mistake in future.

Of course you don’t want to babysit your work force and they should take responsibility for their tasks. But in many situations employees do the best they can and managers should always look for ways to help them be more productive & accurate.

Filling in time sheets is time consuming and on a hectic day it’s probably the last thing your workers have time for. Hastily submitting paperwork often leads to mistakes and it’s understandable that this upsets the HR team & a worker’s manager. But why not make it easier?

Automated procedures with online clock in features such as the products you find on https://advancesystemsinc.com mean your workers don’t have to do any paperwork and all data will be accurate. With fewer misunderstandings and reprimands your workers are bound to feel more content coming to work.

At the same time you’re communicating company values such as accuracy, punctuality and excellence. Help them act according to these traits so they can be proud of what they achieve each day.

Important note: You’re not simply doing this to keep everyone happy. You’ll never again have to pay for work not done and you won’t waste time on salary disputes.

[Conclusion]

Do you see new hope for your company? A healthy—even happy—office environment can be a few adjustments away. Investing time into this outcome will have the long lasting effects you’ve only dreamed of so far. Good luck.

Paycheck Checkup May be Needed

The Tax Cuts and Jobs Act made significant changes to the tax law, including increasing the standard deduction, eliminating personal exemptions, increasing the child care tax credit, limiting or discontinuing certain deductions and changing the tax rates and brackets.  While these changes did not affect the 2017 tax returns they will affect the 2018 tax returns filed next year.  For this reason the IRS is continuing to push a “paycheck checkup” for all employees but especially seasonal or part-time employees. To assist employees the IRS unveiled several new features to help people navigate the issues affecting withholding in their paychecks. The effort includes a new series of plain language Tax Tips, a YouTube video series and other special efforts to help people understand the importance of checking their withholding as soon as possible including a withholding calculator.

Employees can use the Withholding Calculator to estimate their 2018 income tax. The Withholding Calculator compares that estimate to the employee’s current tax withholding and can help them decide if they need to change their withholding with their employer.  When using the calculator, it’s helpful to have a completed 2017 tax return available. Employees who need to adjust their withholding will need to submit a new Form W-4, Employee’s Withholding Allowance Certificate, to their employer. If an employee needs to adjust their withholding, doing so as quickly as possible means there’s more time for tax withholding to take place evenly during the rest of the year. But waiting until later in the year means there are fewer pay periods to make the tax changes – which could have a bigger impact on each paycheck.

Among the groups who should check their withholding are:

  • Two-income families.
  • People working two or more jobs or who only work for part of the year.
  • People with children who claim credits such as the Child Tax Credit.
  • People with older dependents, including children age 17 or older.
  • People who itemized deductions in 2017.
  • People with high incomes and more complex tax returns.
  • People with large tax refunds or large tax bills for 2017.